Pepsi Bottling profit beats Wall Street view

By IBT Staff Reporter On 02/02/10 AT 8:24 AM

Pepsi Bottling Group Inc, which is due to be acquired this quarter by PepsiCo Inc, reported a higher-than-expected fourth-quarter profit as productivity improvements offset a slight dip in worldwide sales.

The largest bottler of PepsiCo beverages such as Pepsi-Cola, Mountain Dew and Aquafina water said net income was $90 million, or 40 cents per share, in the 16 weeks ended on December 26, compared with a year-earlier loss of $271 million, or $1.28 per share.

Excluding one-time items, such as advisory fees linked to its merger with PepsiCo and changes to Mexican tax laws, earnings were 59 cents per share, above analysts' expectations of earnings of 43 cents, according to Thomson Reuters I/B/E/S.

Pepsi Bottling said that cost savings and improvements such as leaner warehouse operations, had exceeded its expectations.

The company said that net revenue per case has risen 3 percent, which helped mitigate a 3 percent drop in worldwide physical case volume.

Pepsi Bottling operates in North America, Greece, Russia, Spain and Turkey. It agreed in August to be acquired by PepsiCo, its largest shareholder and supplier.

Revenue edged down 0.1 percent to $3.81 billion, below analysts' estimates of $3.83 billion. Sales in North America, which made up 76.8 percent of the total, and Europe were flat, but fell 5.2 percent in Mexico, including the effects of currency fluctuations.